1 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Decision Support in Business.

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1 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Decision Support in Business

2 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Ingredients for Sound Decision Making  Understanding political, economic, and competitive environment  Understanding internal status: SWOT  Understanding customer needs and values  Insight and judgment  Information, analytical models, interactive modeling tools

3 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Information for Decision Making

4 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Management Information Systems  The original type of information system; producing:  Periodic scheduled reports  Exception reports  Demand reports and responses  Push reports

5 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Online Analytical Processing  Interactively examine & manipulate data from multiple perspectives:  Discover patterns, trends, and exception conditions  Works in real-time (on demand)  Involves: Consolidation, Drill-Down, Slicing and Dicing

6 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Decision Support Systems  models  e.g. Linear programming, multiple regression forecasting, capital budgeting present value, or your own models  Databases  Internal and external data  Analytical modeling  What-if analysis  Sensitivity analysis  Goal-seeking analysis  Optimization analysis  Dataming

7 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Executive Information Systems (EIS)  Also known as “Enterprise information systems” or “Executive support systems”  Features of EIS  Custom-tailored presentation  GUI and graphical display  May include exception reporting and trend analysis

8 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Other Decision Support Tools  Geographic Information & Data Visualization Systems  Enterprise Information Portal (EIP)  Knowledge management (KM) systems  Group Decision Support Systems  Electronic Meeting Systems (EMS)

9 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Artificial Intelligence  Cognitive Science, applied to:  Expert systems  Adaptive learning systems  Fuzzy logic systems  Neural networks  Intelligent agents  Robotics – computer controlled machines with computer intelligence  Natural interfaces  Natural language and speech recognition  related to Virtual reality

10 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 8: Decision Support Systems Expert Systems  act as expert consultant  for specific problem area  Contains  “knowledge base” and heuristics  Software (e.g. inference engine, user interface)  Built by “Knowledge engineer” starting with a shell and adding the knowledge base.  What are the business values and limitations of an Expert System?